3 Restaurant Stocks Ready to Fizzle

These stocks are sizzling, but not for long

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3 Restaurant Stocks Ready to Fizzle

Noodles & Co.

noodles and company 630 150x150 3 Restaurant Stocks Ready to FizzleI’m a big fan of Noodles & Co. (NDLS). I eat there often with my two young daughters.

That said, how much pasta does the world need? I think many investors compare Noodles to Chipotle. They are not the same. In fact, if the country figures out that we need less pasta and not more, Noodles & Co. could be in big trouble. The company reports earnings on Wednesday after the market closes.

Noodles is a newly minted publicly traded company. Its shares got the obligatory pop when first available on the market, but the stock has traded sideways and drifted lower in the last month of trading. Analysts expect the company to grow profits by 37% in 2014.

That is impressive indeed, but the stock trades for 110 times 2013 estimated earnings. When the company last reported, it beat estimates by the proverbial penny per share. That’s not going to cut it with this sort of valuation. Get out before the earnings are reported.


Article printed from InvestorPlace Media, http://investorplace.com/2013/11/stocks-to-sell-restaurant-stocks-wen-cmg-bwld/.

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